mine the firm's current earnings per share. n Waller currently owns 700 shares of the firm's stock, determine his proportion of ownership currently and late the market price per share under the 20% stock dividend plan. ne proposed 20% stock dividend plan, calculate the eamings per share after payment of the stock dividend. is the value of Sam's holdings under the 20% stock dividend plan? d Sam have any preference with respect to the proposed stock dividend? firm's current earnings per share is $ (Round to the nearest cent.) am currently owns 700 shares of the firm's stock, the proportion of the firm Sam currently owns is %. (RoL

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Stock dividendInvestor Personal Finance Problem Security Data Company has outstanding 40,000 shares of common stock currently selling at $35 per share.
The firm most recently had earnings available for common stockholders of $118,000, but it has decided to retain these funds and is considering a 20% stock dividend in
se Options lieu of a cash dividend.
a. Determine the firm's current earnings per share.
b. If Sam Waller currently owns 700 shares of the firm's stock, determine his proportion of ownership currently and under the proposed 20% stock dividend plan.
C. Calculate the market price per share under the 20% stock dividend plan.
d. For the proposed 20% stock dividend plan, calculate the eamings per share after payment of the stock dividend.
e. What is the value of Sam's holdings under the 20% stock dividend plan?
f. Should Sam have any preference with respect to the proposed stock dividend?
ar
a. The firm's current earnings per share is $
(Round to the nearest cent.)
b. If Sam currently owns 700 shares of the firm's stock, the proportion of the firm Sam currently owns is
%. (Round to two decimal places.)
The proportion of the firm Sam will own after the 20% stock dividend is
%. (Round to two decimal places.)
c. If Security pays a 20% stock dividend, the market price of stock after the dividend is $
(Round to the nearest cent.)
Click to select your answer(s).
P Type here to search
insert
Transcribed Image Text:Home Stock dividendInvestor Personal Finance Problem Security Data Company has outstanding 40,000 shares of common stock currently selling at $35 per share. The firm most recently had earnings available for common stockholders of $118,000, but it has decided to retain these funds and is considering a 20% stock dividend in se Options lieu of a cash dividend. a. Determine the firm's current earnings per share. b. If Sam Waller currently owns 700 shares of the firm's stock, determine his proportion of ownership currently and under the proposed 20% stock dividend plan. C. Calculate the market price per share under the 20% stock dividend plan. d. For the proposed 20% stock dividend plan, calculate the eamings per share after payment of the stock dividend. e. What is the value of Sam's holdings under the 20% stock dividend plan? f. Should Sam have any preference with respect to the proposed stock dividend? ar a. The firm's current earnings per share is $ (Round to the nearest cent.) b. If Sam currently owns 700 shares of the firm's stock, the proportion of the firm Sam currently owns is %. (Round to two decimal places.) The proportion of the firm Sam will own after the 20% stock dividend is %. (Round to two decimal places.) c. If Security pays a 20% stock dividend, the market price of stock after the dividend is $ (Round to the nearest cent.) Click to select your answer(s). P Type here to search insert
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